USD/JPY Big Trade Orders 03.28.2016 – CANCELED

We have been bullish USD/JPY for sometime now and have been waiting for this morning’s personal income, spending and PCE data to trigger pullback in the pair. The recent rally in USD/JPY is becoming overstretched and while we believe the March highs of 114.55 will be tested, we prefer to buy on a pullback than chase the rally. Fundamentally, we believe this week’s non-farm payrolls report will be positive for the dollar -- not because of the absolute amount of payroll growth but because average hourly earnings are due for a bounce. Japan’s Tankan survey, which is also scheduled for release this week should highlight the ongoing weakness in Japan’s economy. If USD/JPY moves upward, tomorrow’s speech from Yellen could ease the gains. For the most part we expect USD/JPY to remain confined within a 111 to 115 trading range .